Markets

Ubiquiti call buyers see near term rally

Ubiquiti Networks had a strong earnings report earlier this month, and now the bulls are back.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 3,600 September 50 calls for $0.45 late Friday, followed minutes late by about 2,100 September 47 calls. Volume was more than 6 times open interest at both strikes, which indicates new money was put to work on the long side.

Calls lock in the price where investors can buy the broadband-communications stock, letting them profit from a rally at limited cost. They can also generate significant leverage if shares move in the right direction. (See our Education section.)

UBNT ended the session down 0.21 percent to $42.28, and has spent the last six sessions consolidating after a gapping higher on a strong quarterly report Aug. 8. Friday's buyer clearly expects continued upside in the near term.

Total option volume was almost triple the daily average, with calls outnumbering puts by 16 to 1.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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